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Closing Bell With Maria Bartiromo

News/Business. Maria Bartiromo. Analysis of the day's winners and losers in the stock market. New.

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01:00:00

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San Francisco, CA, USA

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Comcast Cable

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Virtual Ch. 58 (CNBC)

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mpeg2video

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ac3

PIXEL WIDTH
704

PIXEL HEIGHT
480

TOPIC FREQUENCY

Us 11, Washington 6, Citibank 5, S&p 5, Alan Greenspan 4, Dr. Greenspan 4, Europe 4, Apple 3, Aflac 3, Rick Santelli 2, Kate Kelly 2, Cialis 2, Bernanke 2, Warren Buffett 2, Maria Bartiromo 2, Siemens 2, Jackie D'angelis 2, America 2, Derrick 2, Steve 2,
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  CNBC    Closing Bell With Maria Bartiromo    News/Business. Maria Bartiromo. Analysis of the  
   day's winners and losers in the stock market. New.  

    February 15, 2013
    4:00 - 5:00pm EST  

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but he's not. ♪ he's an architect with two kids and a mortgage. luckily, he found someone who gave him a fresh perspective on his portfolio. and with some planning and effort, hopefully bob can retire at a more appropriate age. it's not rocket science. it's just common sense. from td ameritrade. all right. coming up to the last minute. this was the stock of the day. it was about 2:00 eastern time when word of those memos, internal memo at walmart got out that they had a horrible month of february sales-wise so far. walmart is saying that it was taken out of context but the stock went down sharply, and it's been gradually coming back. that took the market lower as well. retail stocks, the open, had
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some wondering whether the streak is over. igt now the dow is down a fraction. two weeks in a row that we're down. the nasdaq would break its six-week winning streak. the s&p positive, but not by much. the market has stalled here, like it or not. >> we get to that 1525 range in the s&p, and we have a lot of resistance. we can't break through it. still like the market overall. think we still have upside potential. >> thank you, sir. short and sweet. that's it, and it looks like, look at this. the dow may turn positive on the close as they cheer the medal of honor winner ringing the closing bell today. that's it for the first hour. here's the second hour of the "closing bell" with maria bartiromo. have a good weekend. and it is 4:00 on wall street on a friday. do you know where your money is? hi, everybody, welcome back to
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"closing bell." i'm maria bartiromo. it was negative until the very end, and the market is closing positive. coming up, walmart weighs on the dow industrials sending the blue chip index to a second straight weekly loss, but for the day the market actually turned positive in the final few minutes of trading. the dow jones industrial average up tonight up about four points on the session bouncing very strongly on volume picking up. nasdaq composite was down as was the(1) 500. both averages actually finished off the worst levels of the day, the market finishing off of the lows when earlier we saw a pretty good decline because walmart stocks sold off about 3% when the news broke. the dow was lower for two consecutive weeks. let's talk to steve liesman, steven hammers along with john spalanzani and josh lipton and rick santelli. let's talk about what went on today. steve, to you first. what are you hearing about the consumer in light of the walmart
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e-mail warning of a weak february? >> well, you know, maria, it's what i was hearing about the consumer before the walmart e-mail, and that was there was a lot of concern out there among the economists we talked to about the consumer in the first quarter especially and maybe for the whole year. he had that january retail number that beat expectations, but there was a lot of debate, did it actually show any strength for the consumer, and the real issue is this payroll tax cut. let me just explain. the thing is people didn't really understand what had happened to their wages until the end of the month, and it was the end of the month when retail sales probably fell off, if they did, and they were weak in the first part of february which i think is what the walmart executive is saying, so that's why it rings true to me because there is some concern out there that we could post a zero this quarter for consumer spending, which is a big change. >> yeah. i guess, one of the issues here, steven hammers, is that this market has been rallying. fundamentals have improved when you look at housing, certainly
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when you look at the corporate cash, balance sheets, that's always a positive there. but for the most part it's not, you know, gangbusters. the economy has been slow going, and it's an ethemic growth rate, if the a all. so here we have this walmart memo coming out today and the market closes up again. is the market ahead of itself? >> i do believe so. when you look at the market in 45 days basically, it's up about 7%. the question is can it continue? we don't think it will. yes, it will end up a little higher by the end of the year, but as we move in in the second half of the year investors have really got to be cautious. you know, earnings are expected to tighten up a little bit. we still have very slow growth. we still have spending issues. still have problems in europe. we've really got to be cautious out there. >> you say cautious, but what does that mean? what does that mean, be cautious? how are you being cautious? >> well, give an example. the average investor can be very cautious by dollar cost averaging into the markets.
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we're very cautious simply because if the market starts trending downward, we start pulling out of the markets to provide them safety. if they continue to climb, we'll dollar cost average back in. we've got to be tactical about this, and the markets just aren't going to continue this year, and we don't even expect it to be as high as it was last year. >> so you're expecting a selloff then on the horizon? >> a little. we don't expect a lot. we don't expect to go into recession, but we expect some calming down of the marketplace, which is what we've seen in the last week or so. >> and josh, you've been looking at lots of strategist notes and talking to strategists. you say all sorts of strategists are using all kinds of metrics to spot a pullback. what are they? what are the most important metrics to spot a pullback on the horizon? >> sure, maria. after you see the kind of blistering run you've had this year, the s&p 500 up 6.5%, traders and investor strategists looking for a pullback and looking for different guideposts
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and signs of when a pullback is happening, and some are going to look to sentiment indicators and some look to high-yield spreads. the analysts over at jpmorgan are going to be studying that. i talked to paul hickee over at spoke this afternoon, and paul is a bull. one reason is they's going to look at jobless claims and the relationship between jobless claims and the s&p 500. one reason, paul will tell you, he's still bullish because jobless claims, the four-week average, at a post-recession low. >> all right, john, you're sitting there on the trading desk all day long, see the flow. what kind of a commitment are you seeing in terms of equities? is it still as strong as it was earlier in the year in january. what can you tell us in terms of the sentiments on the part of big institutional investors? >> what we're seeing now is the dips are getting smaller and smaller so guys are not waiting for that bigger dip. they are buying smaller and smaller dips. that's why today we saw the walmart news coming out, but that dip was fairly bought
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pretty quickly so walmart was able to hold above its weekly moving average which was a positive sign. i think you actually broke the newsnews that that was an e-mail and voicing the opinions of one person at walmart so i think that was much ado about nothing. if we look at the empire p.m. this morning, very good. consumer confidence was good. things are getting better. washington is getting better. they are coming to the table together. it looks like we're going to get many bargains going forward that are going to yield a grand bargain. europe is still a little wishy washy. the export numbers last night were not that good, but, again, seeing good flows into u.s. equities continually. the g-20 this weekend, a lot of saber-rattling, and saw a lot of money moving out of gold. we saw soros cutting their holdings and moving into their stocks. we haven't seen the big rotation out of bond market and into stocks, but we have seen a lot of money moving out of the
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commodity market and moving that money into stocks. >> yeah. we're still trying to figure out if that's a trend. rick santelli, you say you're not seeing it in terms of fixed income money? >> no, i mean, none of the -- >> we're not seeing that either. >> there's actually a removal out of something, there may be just less of a volume of money going in, but, you know, i like to look at the equity markets the way i look at spreads on the trading floor. we are at a premium spread to most of the other world equities. what did i notice today? the knee say is slipping into negative territory on the year and the daxx is to within 1% of slipping too negative territory. no matter how much better we are, if we see this trend in japan continue, if we see this trend in europe continue, if we see multi-nationals that have operations in europe and their international sales keep moving lower, all of this at some point has to come to roost, even though maybe initially if you don't like the japanese or the daxx, maybe it comes here, but you would think that that's going to be limited in terms of
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time. >> yeah. >> maria, a quick question. i just want to know. rick, if possible you have money moving right into cash from equities and it doesn't pass go and collects 200? >> yeah, yeah. >> i think that's what it is. >> i think that's support of the market there. >> no doubt about it, steve. >> corporations are buying their own stocks on their dips. >> that, too. that's a great point, john. seeing a lot of companies -- wait a second, recently just the last few weeks we're seeing more insider selling as opposed to buying, is that right, even the buybacks have slowed down. >> we're seeing announced buybacks increasing. every day companies are increasing their buybacks and their stocks after their announcement, so we're seeing good flows from companies buying back the stocks. we haven't seen any of this money leave the bond markets yet so that's many trillions of dollars more sitting on the sideline. >> so as these guys fall farther and farther behind the bogeys
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eventually that money has to move to stocks, and that's what bernanke is trying to do, right? you could fight that as much as you want, but you'll have to fight ray dalio, leon cooperman and fight david tepper and all the central banks in the world. >> i don't think the market fooelt feels like the downside in the bond market or equity market is that great. rick, tell me if i'm wrong here. people think that 2.5 is probably the upper range on the ten-year here, so if i'm in the equity market and all i have to do is withstand a 2.5% ten-year, i feel like i'm cool for now. >> i'm right with you on that, and i think that's the high side yield. >> yeah. >> i think the point that steve is making -- >> we came out with a piece this morning that said by year end we'll see $85 billion tapered down possibly to $20 billion to $40 billion. >> i'll believe that when pigs fly.
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i don't believe the temper at all. >> you're so bearish, but yet you say you're still long the market. >> i'm not bearish. i'm a realist. there's a difference. i'm a realist. >> let's talk about the comments for a second. john, you think what bullard said is basically that they are going to start unwinding qe this year. >> yeah. they have given us -- >> no, no, no. john, you're wrong about that. i don't want to be rude here. >> 85 billion now, if the unemployment rate does fall to the fed target of 7% they will decrease asset purchases. they have three fed meetings to do it between now and the year end, we think, so if they reduce asset purchase by 5 billion to 10 billion. >> that would be a surprise. >> that would bring us down to $20 billion or $40 billion. >> that would cause a selloff in stocks, what do you think? >> john, hold on a second. he's a start guy but definitely not speaking for the center of the federal reserve open market committee when it comes to his
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outlook for either quantitative easing or unemployment this year. he may end being right, but i'm just telling you -- >> steve, that's out there. >> it's been out there -- >> as soon as it's out there, it's now being discounted. >> it's been out there. >> we've got to go because i can't hear anything when you both talk at the same time. >> january 3rd, that number, 7%. >> are you saying that that's not going to be the pathway? >> i'm saying i have my doubts that that's the pathway. >> if employment is 7%, what are the asset purchases going to be, steve? >> at 7 exactly? >> yeah. if the unemployment rate falls to 7% by the end of the year. >> we're -- we're at 7.9%. >> yeah. >> at 7, you taper down. >> 7% by the end of the year, that's going to be tough, don't you think? >> we've down 0.9 the past two years. >> all right, guys, look. got to end this. a lot of thoughts here. going to continue this conversation and have a nice long weekend everybody. see you later. bob pisani is on the floor
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today. he was there when the market began to whipsaw on walmart. what's going on now, bob. >> a great discussion, nerdy even by my stab guards. walmart gave us excitement in the middle of the day, went up, went down. take a look at walmart. bottom line, comments from an executive that were not officially released, e-mails, saying it's off to a very slow start in february. the company cautioned and called it private opinions and that's not exactly what the company is going to report. walmart dropping and moving up eventually, ending a little bit shy of positive territory. the stock was down earlier because there was a research report negative on the company. earlier in the day independent of all of this, retailers have a few issues right now. besides the higher payroll taxes, higher energy prices, tougher comps compared to last year and tax refund checks are late this year. that's a major issue for a digs counter like walmart. retailers, kohl's dropped,
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target dropped and there's rumors that there might be interest in gap but the company doesn't comment on rumors or speculation and the higher dollar put pressure on commodities all day. the big story. energy stocks have had a great year, but the bottom line is they have all had a weak day today. finally take a look at the month, february. s&p 500 up 1.4%. maria, look at the rest of the world, all to the downside. we're outperforming everybody else. >> there you go. it looks like it's the best game in town. bob, you said something a minute ago. i want you to tell me when. when do people get the tax checks had. >> they are delayed because the irs would normally be senning out by the middle of january a large number of checks. they have been delayed several weeks because of the problems with -- with dealing with the fiscal cliff issues. >> thanks, bob. we'll see you a little later. after the break, some fishy trading apparently ahead of warren buffett's heinz announcement, the big deal that was announced this week.
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plus, trading at the nasdaq as early as 4:00 a.m. that was the fishy informing we're getting. we'll speak to a manager who can help pull back the curtain on these wall street moves. and two weeks away from the automatic spending cuts that will take place on march 1st. former fed chairman alan greenspan is here to join me to talk about what that could mean for the market and your money. will apple kill the xbox? who says. someone who helped create the xbox apparently. he's come up in a cnbc exclusive. back in a movement then we turned the page, creating the rx hybrid. ♪ now we've turned the page again with the rx f sport. ♪ this is the next chapter for the rx and the next chapter for lexus. this is the pursuit of perfection.
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. welcome back. we have breaking news right now on heinz. right to kate kelly we go with the details. kate? >> reporter: maria, breaking news as you mentioned on the deal that made major headlines this week. the s.e.c., according to reuters, has filed suit consequence quote, unquote, certain unknown traders in h.j. heinz & company in regards to their call options, not active onnage average day, 820 contracts per day and monday and tuesday's volume, while being weak, spiked wednesday to about 3,400 contracts. this is before the deal was announced though. news of the deal came out
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valentine's day morning, yesterday, and, of course, the stock spiked on that news and the call options, depending on what the strike price was, may have been well into the money. a massive upsurge in volume on the day before and presumably the s.e.c., maria, is trying to figure out who was behind that. they have filed a suit of that nature. >> all right, kate. thank you so much. kate kelly. just as the individual investor is coming off of the sidelines could stories like this send them running for cover once again? what does the retail investor need to know. joining me is mart martiac, and derrick kinny. good to see you guys. thanks for joining us. >> my pleasure, thank you. >> what does this mean for the individual investor? mean, how do you be sure you? hear stories like this. well, there could have been activity before the warren buffett acquisition. what's going on? >> interestingly that you ask. most of my clients asked me this week if i had any inclination or understanding what have happened. clearly when there's a speak in the call options trading, it makes you wonder what's going on
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most of the time it's coincidental, however, the s.e.c. may know something that most us don't know, but i don't think it affects the individual trader. high net worth, ultra high net worth or. i don't think it has nothing to do. most of my clients i don't want them to trade stocks like that like day traders. however, the universe of day traders exist out there. we all know it. we don't know what information they are acting on and usually it's after the fact. >> i don't care if it's day traders, high-frequency traders, but the public wants to make sure that the playing field is level. is it level? >> it's not always level. however, i would not discourage any of my clients. >> what do you mean it's not level? >> institutional investors have lots of money. high frequency traders do volume traders. >> what does that mean, they get in front of everybody else? >> sometimes they do and
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sometimes they have information that the individual investors don't. >> how do they have information that everybody doesn't? >> who knows. the s.e.c. understands that and lock at these type of activities and red flags go up. as an individual adviser with my team and clients, we always have to be complaint. >> right. >> so we look -- when there's an investor that comes to me and wants to do call options and it's not in their investor profile, their risk tolerance the way they normally trade, i question, that i can't allow that to happen. >> derrick, what's your take on this? as an investor, how do you deal with this kind of stuff? >> one of the keys here is to not throw the baby out with the bath water. when you think about these investors and i'm on local level here in dallas as i talk to people. the first is a buyer beware mentality. people are losing confidence and having distrust when they hear companies doing these types of things. they feel like a privileged few have information that they don't have, but the rest of the people get punished because they don't get access to the same date a.
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the key is to look at companies with trust and confidence and things that have a good track record. make sure that because one company has a blemish not every other company has those same issues. look at your risk tolerance, your situation for retirement and your goals and make sure these investments are appropriate for your situation. bottom line is don't panic an don't have a knee jerk reaction when you see news like this. >> when you see news like a big deal, i mean, how do you deal with it? do you wait for the dust to settle? you want to wait until the information is out there before making a move and digest it, or not? >> maria, i think the question is asking people what does this news mean to me and my personal financial situation, just because it's a breaking news item for the world doesn't mean it's necessarily good for their personal economy. the key is to look at are there flaws in my own portfolio as an investor, and do i need to make changes base on my overall situation, not just a news item
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today. the key is to look for things where there's trust and confidence. the bottom line is when news like this comes out, it does erode the trust and integrity of the entire stock market. the bottom line investor has no safety net. the pressure is on them to make the best possible decisions. they can't mess it up, but the pressure is on them. if they do, they may be out of their retirement. >> this is just the basics, right? i understand. >> that's right. >> let's talk about the nasdaq pre-market as an example. >> sure. >> and i want both of your takes on this. you say that this is all the more reason for clear entry and exit price strategies. derrick, you said that in terms of the nasdaq. what do you mean? >> well, think about this. the nasdaq is open a few more hours, there's going to be some opportunities there. bottom line, it's almost becoming like a convenience store. if you want gas or groceries, go to the convenience store and now you can buy a stock or bond 24/7 is the trend it appears. the key is that investors, just because the market is open, doesn't mean you have to be buying. this isn't black friday where everything at the store is on sale. you want to make sure that the
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stocks you want to buy are the best for you. >> does that give one portion of the market an advantage because they are in the nasdaq when it's a free market? >> i don't believe so, maria. >> just because they are up at 4:00 in the morning versus 7:00 in the morning. the volumes in the pre-market trading are very, very light. a lot of very heavy volume trading. >> got to be careful with that light volume situation. >> occasionally you do, that's right. >> derrick made a good point earlier, maria. if advisers and clients are working together, they are not focused on this myopic individual trading where it's one stock, it's headline risk and there's a knee jerk reaction to it. you have to look. advisers to look and clients have to listen to their investors. you look at the picture. asset allocations. i share with my clients all the time don't says the green arrows. you alluded to it, too. see where the dust settles and
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see where it takes us. >> thank you both. as we just mentioned the nasdaq may be making a bold move into early morning hours. jackie d'angelis has the story. >> reporter: the nasdaq is looking to start pre-market session, as you guys said, at 4:00 a.m., not 7:00 a.m. as it does now. no coincidence that the earlier start time matches rival nyse euronext. a nasdaq official told me that this is part of a nasdaq strategy to provide trading tools for diverse investment strategies, time horizon and risk tolerance with the goal, of course, of adding liquidity to its marketplace. they also said that it will make it easier for international desks to interact with the nasdaq and not just firms with multi-national exposure but also retail investors and professionals that want to trade off of global news. some are skeptical of the move suggesting that it makes it more difficult for the individual investor to compete. consider the folks on wall street on the west coast who would be trading say at 1:00 in the morning pacific time.
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the opposite side of the argument is that trading volumes in the pre-market session are light, as you guys also said. it really wouldn't impact the retail investor. the nasdaq says year to date only 12 million shares change hands during the early hours. they also say that they are looking to implement this strategy on march 18th, but it is pending s.e.c. approval, and one note, maria on the markets, despite fact that we did hit an intraday, a fresh 12-day intraday, it's the next week that the nasdaq posted a decline so far. back to you. >> jackie d'angelis. after the break, former federal reserve chairman alan greenspan is with me today to get an insight on how the spending cuts to affect the market and the economy, and are the gloom and doom warnings based in reality? we'll ask him. then things are going pretty well in this economy for millionaires, right? three or four of them announcing they are back to pre-2008 crisis levels. coming up, we'll find out what that means to the rest of us. and we'll speak to the creator of the xbox, yes, the creator of
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sequester, you go as you say, congress is now going on vacation back home. they work in their districts, but they are not going to be working on federal laws here in washington, and that has got some people kind of upset. house democratic leader nancy pelosi earlier today says she thinks they should be right here working straight up to the sequester. take a listen. >> the manufacturer to manufacture the crisis and instead having us try to avert crisis they go on a thoin-day recess. why? why? people inside and outside the congress are saying a simple message. no deal. no break. we really should be here. >> well, they are not here, maria, and they do go on that break and there is no deal. i've got to tell you in talking to people here in town. seems more and more like the skywester is going to happen. you hear more voices on both the left and the right saying, you know what? just go ahead and make the automatic spending cut, it's a hatchet but not a scalpel but it might be the only way to get any spending cuts and it might be
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the easier thing to do than have a knockdown drachout fight. democrats proposed an alternative, republicans didn't like it and that's the stalemate we're facing as we go into the recess and just a couple of legislative days left before the march 1st deadline. >> thank you so much. what impact does former fed chair alan greenspan think the spending cuts will have on the economy is we join him now from washington. dr. greenspan, thanks so much for joining us. >> my pleasure. >> let's talk about the sequestration, if it does in fact take effect on march 1st and the spending cuts take place, what kind of an impact would you expect on the broad economy? >> well, i think the odds of it occurring are very high. in fact, i find it very difficult to even think through a scenario in which it doesn't happen. the effect is not going to be horrendous, but it's going to be marked. at the moment i think the critical issue is how does it affect the stock market, and the reason for that is the stock
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market is the really key player in the game of economic growth at moment because there are two factors are stock prices which i think are important to understand. the first is that the so-called equity premium, that is the rate of return that equity is required is a very high number. it is the highest number, close to the highest number probably in american history. this means that it's going to be very difficult to get stocks down. it's very much like saying the earnings price ratio is at a level which it cannot basically go down very much, or i should say the price earnings ratio can't go down very much, and so what you have to do here is to find a way to get through this
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particular pretty much expected event which will have a negative effect on the economy, but if the stock market can hold up through this, i think the effect will be rather minor. let me just say one more thing, maria, which i think is relevant to this issue. >> right, right. >> the data show that stock prices are not only a leading indicator of economic activity. they are a major cause of it. the statistics indicate that 6% of the change in gdp results from changes in market values of stocks and homes. >> and you've said this for years actually, dr. greenspan. you always used to look at the wealth effect and basically what that means for behavior in terms of consumers, so you think the wealth effect gets impacted? >> the wealth effect is actually probably the reason why
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consumers are actually holding up more than one would expect given the payroll tax increase because if you look at some of the data, you can -- it's very hard at this stage to find a payroll tax increase. there's one argument which i like that says that nobody will really know that they had a payroll increase until the middle of the month like now and that we haven't yet seen the impact. i doubt that, but i'm willing to have my mind changed if the numbers change. >> well, it's funny because people mention that the payroll tax increase to me, but you're right. they haven't necessarily felt it yet because of the offsetting nature, maybe, of the stock market and feeling better about things. let me ask you about what the president has proposed because he's talking about the short-term cuts. do you think short-term cuts would avoid the worst impact of sequestration? is that a better alternative?
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>> i think the problem is so seve severe at this stage that unless we come to grips with it in a large way, we're running into very serious trouble. i don't want to say that small cuts here and there won't help, and i don't want to say that the crisis is sitting right over the edge of our nose, so to speak, but this is a holy unsustainable type of economic series of events that are playing out there. i know everyone thinks it's going to be easy to bring the deficit down. but we have picked all the -- all the low hanging fruit, and the low hanging fruit is gone. >> right, right. >> and the result of this is to get the budget deficit down it's going to require some very unpopular actions, and -- and i
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just -- i'm worried because the baby boom generation is now only beginning to retire. >> yeah. >> and we're getting a shift from highly productive baby boomers working in the economy to retirement. >> yeah. >> that has a double whammy effect. >> absolutely. >> and i think -- i don't think we've actually fully understood how big a deal this is, and we're -- and we're assuming that we're going to be able to repress the problem and address it in terms. the fundamental issue, as everyone has been saying, both democrats and republicans, is entitlements. >> but the reason that people don't necessarily understand it yet is because things feel okay, right, dr. greenspan? when you've got ben bernanke providing this stimulus, interest rates at rock bottom
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else, it has offset some other holes in the recovery that are there. i moan do you agree with bernanke's comments in germany that the fed stimulus needs to continue because the economy is far from a full strength recovery? yeah. we have positives, housing, corporate cash on balance sheets, no doubt about it, but for the most part, you know, we're looking at a slow, anemic situation, so does the stimulus from the fed need to be there? >> maria, as i've told you before, i haven't discuss ed my reactions to fed policy since i left office. paul volcker for 18 and a half and a half years never mentioned what policy was or commented on it. i think it's a very good precedent, and i do discuss the economics of structure, what's happening in the money markets and the like, i don't want to say whether i think things are good or bad because once i say it one way or the other, everyone is going to keep asking me. >> i understand, i understand. can you give us a sense of where
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are you in terms of 2013, what kind of economic backdrop that you're expecting? >> i think, first of all, it started off reasonably well in the sense that the weekly data are picking up. industrial production, as you know in january, was not very impressive, but the weekly data are picking up, and very importantly what tends to follow that weekly carloadings, and the carloadings are showing a modest increase in industrial activity into february, and the very actually quite useful purchasing managers indicated for new york was boss tifrks as you know, and that's a good sign. the difficulty i have with the longer-term outlook is that, as i mentioned many times in the past, that we're living in a two-stage economy. one is an economy in which only those goods with a life
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expectancy under 20 years are included, and secondly a very significant and dangerously low level of very long-term assets which unlike the less than 20 years, which you're doing okay, have been cut in half, and that's where all the problem is, and unless we get enough confidence going back for longer-term investment, we are not going to find ourselves back at 3% or 4% economic growth. >> dr. greenspan, real quick on this final question here. in terms of the entitlements and the idea that we absolutely have to change this -- this structure because we can't afford these programs, i feel like everybody understands that, and the average guy and gal out there buys into it. they know that we need to change things. how come we can't get a compromise? what do you think the problem is? >> i think the problem essentially is we need to find a vehicle which everyone agrees
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to. i thought simpson/bowles with their extraordinarily perceptive means of coming at the problem had the answer, and for a while think thought everyone was climbing on board, but that is not the case. this is wholly a political issue, and this is a very difficult problem of which i don't consider myself an expert on. >> what a shame. a real shame that we can't get this done because it certainly is holding back business and consumers. dr. alan greenspan, very nice to have you on the program. so appreciate your time tonight. >> my pleasure. >> alan greenspan joining us tonight from washington. breaking news right now on facebook and back to julia boorstin we go. julia. >> reporter: that's right. facebook says it was hacked and that there's no evidence that user data was compromised. just announced moments ago on a blog post that it's been a target of a series of attacks by an unidentified group of a hacker group.
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a malware was installed on their computers. this is the kind of thing that even the most sophisticated anti-virus software could not have protected. they did have anti-virus software on their computers. this was a very sophisticated hack but there's no evidence that any user data has been compromised. >> looks like the hackings are getting more so fisted kay the minute. >> reporter: maria, i just want to point out twitter recently was hacked two weeks ago, and they say this has been in the works for a month now. >> thank you. coming up, the millionaire outlook on the economy. find out why it's so sunny and how you could benefit from it. and what could be happening at apple that has the creator of the xbox so they are vows? plus, that was fast. passengers from the crippled ship filing the first lawsuits against carnival cruises. we'll get the latest. back in a moment. what do you see? um, i see a duck. be more specific. i see the aflac duck. i see the aflac duck out of work and not making any money.
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okay. [ male announcer ] with citibank's popmoney, dan can easily send money by email right from his citibank account. nice job ben. [ male announcer ] next up, the gutters. citibank popmoney. easier banking. standard at citibank. life is good for millionaires. robert frank joins us with the sunny outlook for the wealthy. >> reporter: a new survey from northern trust says three out-of-four millionaires say they feel better off than they were in 2007, 2007, of course, the peak for wealth and the
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reason, the stock market. more than half of them said investment returns and a higher net worth were the reason for their higher confidence. that's the magic of $8 trillion coming back to the market. the good news, this confidence could translate into more hiring. more than three-quarters of the wealthy business owners plan to hire or keep their staffing level over the next year or two. there was some bad news here. while confident about their private finances, they are more pessimistic about america's broader future. two-thirds say the country is worse off than it was in 2007. the reason, yes, washington, maria. we talk about this a lot. they cite the national debt and unemployment as the biggest problems and a third of them blamed their negative outlook on obama administration. the message here. the wealthy have now fully healed from the crisis, but they won't have full confidence until the country fixes its own finances. maria. >> all right. thank you so much. robert frank. up next, gamers beware. there's a first person shooter taking aim at xbox, the wii and
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playstation. up next, one of the creators of microsoft's xbox will join me with a move that could reboot the video game business and the first lawsuits against carnival coming out. the latest details on this developing story. back in a moment. [ laughs ] now this is a test drive. whoa! you really feel all 335 foot-pounds of torque. it's chevy truck month! silverado was also recognized for the lowest cost of ownership. hey, what are you gonna do with it? end table. oh. [ male announcer ] it's chevy truck month. now get 0% financing for 60 months,
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yet big changes could be ahead. xbox co-creator matt brown says apple may be bringing gaming to its apple tv platform, and if he does he believes that would be a killshot for the wii, playstation and, yes, even his creation the xbox. good to have you on the program. this is really serious coming from you. apple has no device in the market. how can apple be a console-killer here? >> you know, i started writing about this because i was very frustrated with what microsoft has been doing with xbox. xbox has been stumbling, not letting independent developers really create games, and also the user interface has become frustrating and slow and -- and difficult to use for consumers, and those are things that if you don't pay attention to them, it will open up the market for your competitors. and what i point out is that apple has really a great opportunity, if they want to, to
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take the advantage that they have in simple user interface and great developers writing games to come into this market. >> so they should be doing that. they should be anticipating apple coming in. i mean, we reached out to apple but declined to comment, but i spoke to an analyst that told me that gaming will be a killer app on apple tv. >> i think so, too. >> how soon does it happen? >> apple will make a product when they are ready and when it's right, so you really can't second guess that, i don't think. it could really happen any time. they have all the pieces in place to really build something that is very competitive in the console space. even something that is -- starts out not seeming competitive, just more applications, maybe not even hard core games on the tv, but they real very a bunch of assets that they could bring to play, and microsoft has really let it slide t.sat on its laurels and it hasn't innovated. >> that's going to be a problem because microsoft has missed a
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fair amount of big innovations like the ipad, like the mobile phone. if they are going to blow it on the xbox -- let's put that aside for a moment. what do you want to say, nat? go ahead. >> i was just going to say, yeah, it's very frustrating. the blog post that i wrote that a lot of people got interested in here is just frustration, like why are these things? why are you missing this opportunity? here's a great device. you have a great sales, great opportunity. why are you messing it up? i don't know why they are messing it up. i think they just don't have focus, and they are just not -- they are just not being diligent about what the competition is. >> so do you think that -- ther should be new blood coming in to microsoft? >> yeah. i always think that. >> you always think that. >> i thought that for how many years have i been away? yeah, about 13 years i have thought that. >> mm-hmm. what do you think this means.
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let's say apple getting into the gaming market. what does this mean for the electronic arts of the world? >> well -- >> and activision. >> and blizzard. one of the things like like about the console business is it's a walled garden where they can sell software at a high price. that's great for them. they don't like lots of independent developers in tear space. because that will tend to pull prices down. so i think at first it would worry them. but the reality is that what this would do for the overall market of gaming is it will grow the market. just like mobile devices and tablets have expanded the size of the gaming market and the gaming audience and the number of dollars spent in games. over time this grows the market and floats all the boats. in the short term it would not be a positive thing for the e.a.s and blizzards. they have not done a fantastic job transitioning to mobile and tablet games.
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>> right. >> so the same might be true on a new console that was more open. >> good to have you on the program. thanks so much. we appreciate your time. >> a pleasure being here. >> getting off the boat was half the journey for some of the carnival "triumph" passengers. now the lawsuits are beginning. developing details are next. stay with us. all stations come over to mission a for a final go. this is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers. omnipotent of opportunity.
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well, the passengers and crew may have disembarked the carnival "triumph" shift but the public relations fiascos are continuing to rise like the tide and the first lawsuits are rolling in. chris palone is in mobile, alabama, with the latest. chris? >> reporter: you had to expect it sooner or later. it happened sooner. the passengers got off a boat not 24 hours ago and now we get word that a lawsuit has been filed in miami today by a texas woman who is alleging breach of contract, fraud, neglect. she claims the carnival company did not provide adequate facilities to use the restroom and did not provide basically a working boat.
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she's asking for pain and suffering for a court to find carnival guilty of inflicting emotional distress on her. she's looking for an unspecified amount of money. surprise, surprise. >> we'll be following this. this is probably the first of more to come. chris, thank sos much. the stock has taken a hit. shares of carnival are down about 5% -- over # 5% this week. do traders see more pain ahead? we have mike keoh, an options action contributor. good to see you. what are you expecting for carnival? >> most of the traders are probably expecting this thing to go lower. it is testing the 150-day moving average here. this is a stock that's still net of the decline trading a turn more rich than royal caribbean which is a cheaper stock and doesn't face the same concerns this one does. $36, if it breaks that you need to watch out. it is more expensive than the market. and the options traders, we saw buyers of the march 35 p puts
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paying 50 cents for those. those are bearish bets that the stock would drop below $35. of course this is one of the things. we are looking at the liability here. the company announced thises going to have an impact of ten cents a share on $2.20 of earnings. it's the liability and the potential impact on future bookings, not so much this one event. >> that's the critical thing. mike, thanks. see you later. options insight, more to come. stay tuned for "options action "at the top of the hour. and a big reason the dow is lower for a second straight week. details next. ♪ [ cows moo ] [ sizzling ] more rain... [ thunder rumbles ] ♪ [ male announcer ] when the world moves... futures move first. learn futures from experienced pros
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